Isle Of Man Calls On UK To Bring Gibraltar Into EU Savings Tax Regime

by Jason Gorringe, Tax-News.com, London

25 July 2005

Malcolm Couch, the Isle of Man's tax assessor, has threatened to suspend retention tax or exchange of information on UK residents' accounts held in the jurisdiction unless Gibraltar is brought within the ambit of the European Savings Directive, it has been reported.

It emerged earlier this month that the Directive, which went into effect on July 1, does not currently apply between Gibraltar and the United Kingdom as they are not separate member states of the EU, a revelation which caused outrage in the offshore centres of Jersey and Guernsey as well as the Isle of Man.

"Gibraltar has the capacity to completely derail the savings directive," Mr Crouch remarked, according to the Isle of Man Online.

"If the UK don't do something about Gibraltar, they will quite openly be creating a tax haven within the EU, which is against everything the directive stands for," he added.

Mr Crouch suggested that the authorities in Gibraltar are actively using the situation to attract new funds, commenting that: "They are playing a long game - not being particularly helpful to the UK in closing the gap."

"If the UK government can't sort this and we can't get satisfaction, we will suspend the UK financial agreement," Mr Crouch warned.

At a meeting of the Crown dependencies next week, the Guernsey government intends to call on the UK to force Gibraltar into compliance with the Directive as soon as possible.

"That is the date when the directive could live or die," said Mr Crouch.

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